It can be difficult to talk about estate planning, because it forces people to think about a time when they won’t be around the ones they love anymore. However, it is crucial to start estate planning as early as possible. It is a precaution that ensures your family and loved ones will be taken care of, or in the case of unfortunate family issues, such as divorce, it can help protect vital assets. “When a marriage dissolves, one of the first steps in the divorce process is to divide the marital assets and debts. The process for dividing this property in Michigan is called equitable distribution, and it can often be a thorny process” said attorney Paul J. Tafelski. P.C.
Estate planning can be a complicated process, and as more assets and beneficiaries become involved, the process only gets more complicated. Don’t let that stop you from doing it, though. There are people whose sole job is to make estate planning as easy as possible, and they can help you figure out exactly what will work for you.
How Much is Your Estate Worth?
One of the first steps you need to take when estate planning is determining how much your estate is worth. That seems simple enough, but a lot of people go into the process blindly and have no real idea of what all of their assets are.
There are basic “estate calculators” on the market. These are forms that allow you to get an idea of how much your gross estate is worth. There are also a number of professionals who can walk you through every step of the process and make sure you’re determining the worth of your estate accurately. If this is an option for you, it can end up saving you a lot of time and it can help you make sure that you have put everything in place to ensure that your estate is handled properly.
The Estate Tax
The Estate Tax continues to be a subject for debate among politicians in Washington, D.C. While it’s difficult to predict the future of Estate Tax, it’s important to know how it could currently affect you. I know that there are opinions on both sides of the aisle regarding this, but we’re not here to argue politics. I just want you to be aware that estate planning can get complicated and that determining your assets and the worth of your estate is just one simple part of the process. Here is what the IRS has to say about the Estate Tax:
“The Estate Tax is a tax on your right to transfer property at your death. It consists of an accounting of everything you own or have certain interests in at the date of death (Refer to Form 706 (PDF)). The fair market value of these items is used, not necessarily what you paid for them or what their values were when you acquired them. The total of all of these items is your “Gross Estate.” The includible property may consist of cash and securities, real estate, insurance, trusts, annuities, business interests and other assets.”
So, what is the first step of estate planning? Is it determining the worth of your estate? Is it figuring out how much in tax family members will have to pay? Honestly, it’s finding someone to work with you who understands every step of the process. Effective estate planning can make life easier for your loved ones after you’re gone. It’s important that every aspect of it is handled correctly.
Have you started your estate planning? Have you found someone who can help guide you through the process? Share your recommendations with us.